Businessman Hangwani Morgan Maumela, his mother and his sister are fighting a R1.9 billion tax assessment issued by the South African Revenue Service (SARS) against their family trust, as a dispute over billions of rands in financial transactions heads through the courts.
Maumela, his mother Mboneni Maumela and his sister Rumani Maumela are challenging the assessment in their capacities as trustees of the MHR Family Trust.
The amount SARS is claiming is approximately R1.93 billion, comprising tax, penalties and interest. The trust disputes the assessment and is seeking to have it set aside.
SARS questions more than R1.17 billion in deductions
The dispute dates back to SARS’s examination of the trust’s tax affairs.
According to reporting on the court papers, SARS questioned deductions totalling approximately R1.174 billion that the trust had claimed in its tax returns.
The revenue service indicated that it intended to disallow almost the entire amount, with only about R49,887 in bank charges accepted as substantiated.
SARS raised concerns about payments made to unidentified beneficiaries and businesses linked to Maumela. It also questioned expenditure involving luxury vehicles and properties, saying the trust had not demonstrated that the payments qualified as legitimate income-producing expenses.
The disputed assessments relate to the trust’s 2018 to 2022 tax years. SARS issued an assessment of approximately R1.93 billion in August 2024.
Maumela challenges the tax assessment
Maumela disputes SARS’s handling of the matter.
According to his version in the court proceedings, the trust’s earlier financial statements contained errors and had not been properly prepared or finalised.
He says a new accountant was appointed to correct the records and that the revised information would reduce the tax liabilities.
The trust also maintains that SARS failed to properly consider its corrected financial statements and did not follow the audit process as required.
SARS disputes those allegations. Its position is that the trustees failed to provide sufficient records to substantiate the claimed deductions and explain transactions presented as loans.
These are opposing positions in an unresolved legal dispute, rather than findings that the trust or its trustees have committed a tax crime.
High Court must first decide whether it can hear the case
The matter has reached the Gauteng High Court in Pretoria, but the court has not yet decided whether the R1.9 billion assessment is valid.
The immediate dispute concerns jurisdiction: whether the High Court can hear the trust’s challenge or whether the matter must proceed through the Tax Court.
Judgment on that preliminary question has been reserved.
The trust is also pursuing contempt proceedings against SARS, alleging that the revenue service failed to comply with an earlier court order governing the audit and settlement process.
SARS contests the trust’s account of the dispute.
Separate scrutiny over Tembisa Hospital contracts
The tax battle comes amid wider scrutiny of Maumela’s business dealings involving Tembisa Hospital.
In July, the Department of Health announced a final court order for the forfeiture of luxury assets valued at approximately R325 million linked to Maumela. The department said the action formed part of efforts to recover assets connected to alleged fraud involving the hospital.
The tax proceedings and the investigations into hospital procurement are distinct legal matters. The R1.9 billion assessment is being challenged, and the court has not yet ruled on its merits.
For now, Maumela and his fellow trustees are awaiting a decision on which court should hear their challenge before the substantive dispute over the tax bill can proceed
